Torstar employees blindsided by owner court battle - The Globe and Mail

The Toronto Star building on Jun. 8, 2016.Eduardo Lima/The Canadian Press

The union representing workers at Torstar Corp. said it was “blindsided” by news of a court application to wind up the parent company, which has put the future proprietorship of the firm’s assets in doubt, including the Toronto Star.

Randy Kitt, director of media for Unifor, said the union had no advance notice a battle was under way between Paul Rivett and Jordan Bitove, who purchased Torstar in 2020 through a newly formed company called NordStar Capital Inc., in which they are equal partners.

“When these two bought the chain, we were excited,” Mr. Kitt said. “We were promised there would be investments in the papers, and we expected stability, not chaos.”

He added the union, which represents some 10,000 media workers, including at Torstar properties Metroland Media Group and The Hamilton Spectator, is seeking clarity about the implications of the court application from management representatives. Mr. Kitt said employees should have found out about the matter through the company, not through the media.

Neither Mr. Rivett nor Mr. Bitove responded to a request for comment.

On Sept. 1, Mr. Rivett filed a court application through companies he controls to request a wind-up of NordStar and proposed a process for how the company’s assets could be split between him and Mr. Bitove at fair value, or sold off if neither partner is interested. He also detailed a complete breakdown in his relationship with Mr. Bitove, partly over cost-cutting at Torstar’s media properties.

“Rivett and Bitove have fundamentally different and irreconcilable views as to the needs and proper management of NordStar and the controlled companies,” the filing states. “They can no longer work together.”

The Toronto Star was also caught off guard by news of the feud. President Marina Glogovac addressed the issue for the first time in a company-wide e-mail on Sept. 29 after news of the court filing broke. “We acknowledge that this situation will no doubt generate rumours and feelings of uncertainty,” she wrote. “However, I want to assure you that I and the entire management team remain unequivocally committed to the Star, its people and its long-term success.” (Ms. Glogovac did not respond to a request for comment.)

In her note, she added, “We are excited about 2023!”

What the company will look like next year and beyond – and who will own it – is now highly uncertain. Mr. Rivett claims his partner has rebuffed requests to divvy up NordStar’s assets. The court application portrays Mr. Bitove as enamoured with his role as publisher of the Toronto Star while allegedly shirking his responsibilities as a director of NordStar, namely that it run as a profit-seeking enterprise.

Mr. Rivett claimed his partner reneged on cost-cutting plans he argues are necessary for Torstar’s long-term viability in a challenging media market, and refused to agree to sell real estate assets after NordStar breached a credit facility. The filing also alleges Mr. Bitove improperly attempted to push through changes at the boards of various subsidiaries to give himself more control, while sidelining Mr. Rivett.

In a statement sent by communications firm Navigator Ltd. on Sept. 29, Mr. Bitove said he would make no apologies for his decisions as publisher. He also implied his partner preferred to “cut costs to the bone,” while he believes in the “vital role of the media in a strong and vibrant society.”

Since forming NordStar, the pair has launched a last-mile delivery service and an online casino and sportsbook called NorthStar Gaming, while acquiring Cineplex Magazine and partnering with retailer Golf Town to buy ScoreGolf magazine and its digital assets.

Last year, Torstar also partnered with Toronto-based Enthusiast Gaming Holdings Inc. to launch a social-media-based news platform for Gen Z dubbed AFK.

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2022-09-30 21:18:52Z
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